Match the transactional descriptions in List-I with their appropriate accounting journal entries in List-II:List-IList-II(A) For Transfer of Application Money(I) Share Allotment A/c Dr. To Share Capital A/c(B) For Money Refunded on Rejected Application(II) Share Application A/c Dr. To Share Capital A/c(C) For Amount Due on Allotment(III) Share Application A/c Dr. To Bank A/c(D) For Receipt of Allotment Money(IV) Bank A/c Dr. To Share Allotment A/cChoose the correct option from the choices given below:
- A(A) - (IV), (B) - (III), (C) - (II), (D) - (I)
- B(A) - (II), (B) - (III), (C) - (I), (D) - (IV)
- C(A) - (II), (B) - (I), (C) - (IV), (D) - (III)
- D(A) - (III), (B) - (IV), (C) - (I), (D) - (II)
Solution & Step-by-step Explanation
Let's evaluate the standard accounting treatment cycle for issuing shares:Transfer of Application Money to Share Capital (A): This capitalizes successful applications Share Application A/c Dr. To Share Capital A/c (II).Refund on Rejected Applications (B): Reverses the original cash collection path Share Application A/c Dr. To Bank A/c (III).Allotment Money Due (C): Establishes a claim from the company Share Allotment A/c Dr. To Share Capital A/c (I).Receipt of Allotment Money (D): Records incoming cash Bank A/c Dr. To Share Allotment A/c (IV).Therefore, the matching combination is (A) - (II), (B) - (III), (C) - (I), (D) - (IV).